Statoil handing over the Polarled pipeline to Gassco

Statoil transferred the operatorship for the Polarled pipeline to Gassco on 1 May. The 482-kilometre pipeline between the Aasta Hansteen field in the Norwegian Sea and Nyhamna in Møre og Romsdal was delivered NOK 4.5 billion below budget.

Polarled is the first subsea pipeline crossing the Arctic circle on the Norwegian continental shelf, opening a brand new freeway for Norwegian gas to the markets in the UK and Europe. The gas transportation capacity is some 70 million cubic metres per day.

The pipe laying started at Nyhamna in March 2015 and in September the same year the last pipe joint was installed at the Aasta Hansteen field in the Norwegian Sea.

The original investment budget for the pipeline project was some NOK 11 billion. When the pipeline is handed over to Gassco the investments have been reduced to NOK 6.5 billion, a 40 percent cost reduction.

“This was achieved thanks to good planning, good market knowledge and good implementation capturing synergies between several pipeline projects. Based on this, we have also been able to adjust capacity and price to the market,” says Torger Rød, Statoil’s senior vice president for project development.

By connecting Aasta Hansteen to Nyhamna through the Polarled pipeline, also gas from this province can reach the markets in the UK and on the Continent. From Nyhamna the Langeled pipeline runs to England through the Sleipner hub, which is also connected to the transportation system exporting Norwegian gas to the Continent.

“Polarled opens for gas export to Europe from an entirely new area, bolstering the position of the Norwegian continental shelf as a reliable long-term supplier. With the infrastructure in place, it will also be more attractive to explore and develop fields in the neighbouring areas,” says Grete B Haaland, Statoil’s senior vice president for asset management.

The pipeline has six tie-in points for new discoveries, and Dvalin will be the first field besides Aasta Hansteen using Polarled. Statoil is now transferring the operatorship for the Polarled pipeline to Gassco along with the operatorship for Polarled Development project.

The Polarled project also includes Nyhamna upgrading, which will be completed this year. Shell, the operator of Nyhamna, has been responsible for this part of the project.